A Decrease in the Expected Inflation Rate Leads to ________

question 59

Multiple Choice

A decrease in the expected inflation rate leads to ________ in the long-run Phillips curve and ________ in the short-run Phillips curve.

• A) an upward shift; no shift
• B) a leftward shift; an upward shift
• C) no shift; no shift
• D) no shift; a downward shift

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Definitions:

Extrusive Rock

Igneous rock that forms on the Earth's surface as lava cools and solidifies.

Igneous Rock

Stone created by magma or lava hardening as it cools.

Viscosity

A measure of a fluid's resistance to flow, where fluids with high viscosity flow more slowly than those with low viscosity.

Crystal Content

The proportion of crystals within a rock, influencing its texture and appearance, particularly relevant in the study of igneous rocks.